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OLCC HEARING TO CONTINUE
by: David F. Ashton, SMILE President Mat Millenbach presents testimony urging certain restrictions be placed upon any liquor license issued to the proposed Casa Diablo.

The road for owners to open Casa Diablo, a new 'gentleman's club' just south of the Acropolis on S.E. McLoughlin Boulevard between Umatilla and Ochoco Streets, took another sharp turn at the Oregon Liquor Control Commission (OLCC) hearing for their liquor license application on April 5.


The hearing started with Casa Diablo owners Johnny Diablo Zukle and Carol Lee sitting at the witness table with OLCC Director of License Services Division Farshad Allahdadi. Allahdadi began by telling the empanelled five commissioners that there were 'negative endorsements for this application site', including:

• Sufficient licensed premises in the area;

• The proximity of the proposed location to the adjacent Johnson Creek Park; and

• The receipt of 75 letters from people surrounding the proposed site.

Allahdadi added, 'The Sellwood Moreland Improvement League (SMILE), which is the recognized neighborhood association for the proposed location, formally opposed the application, citing similar issues, and adding 'excessive noise'.'

The OLCC also received letters of opposition, Allahdadi continued, from the Ardenwald-Johnson Creek and Eastmoreland neighborhood associations, the Neighborhood Coalition 'Southeast Uplift', Oregon State Senator Diane Rosenbaum, and the 'Uno Dos Tres Academy' - a Spanish-speaking immersion preschool located to the west of the proposed location, and which claimed to use Johnson Creek Park daily.

Of 75 the letters received, he went on, the majority indicated that the application should be denied because will increase 'problems in the area', or negatively impact the use of Johnson Creek Park.

The staff evaluated three possible denial bases, Allahdadi said, 'Crime problems in the area; proximity to facilities; and that the applicants are alleged to have a poor record of compliance.'

'Neighbors wrote about crime levels in the area, and how this is his will worsen the situation,' Allahdadi said. 'We take seriously the licensed business might contribute to higher levels of crime. The first step is to determine the existence of a problem area, and then determine if the operation would contribute to the problem.'

To do this objectively, he explained, the OLCC compliance officers review law enforcement crime statistics that fall into categories of aggravated assaults, simple assaults, drug abuse, minor in possession, drinking in public, trespass, garbage and litter, disorderly conduct, noise, and gang activity.

'Portland Police Bureau of records indicate that, in the last 12 months, that there are only two incidents from these categories documented within 500 feet of the proposed location. The numbers of these incidents are well below we would normally consider indicating a problem area. We therefore believe this basis for denying application is not supported.'

That the proposed establishment is located within 500 feet of Johnson Creek Park was the crux of this denial basis, Allahdadi said. And, the contention that it would adversely impact that park because, among other visitors, 'Uno Dos Tres Academy' preschool at 8718 S.E. 17th Avenue claims to use the park daily for education.

'The staff concluded that the distance, the physical barriers, and lack of visibility from the developed areas of the park to the proposed location - and the lack of documented problems at the park associated with another nearby, and similar, licensed business [the Acropolis] - make it difficult to establish that the proposed operation would have an impact on the activities in the park. Therefore, the basis is not supported.'

'A number of letters in opposition referenced issues at the applicant's St. Helens Road location,' Allahdadi stated. 'The commission has a record of only a single service permit violation, and that was in 2009. That single 'Category 3' violation, does not establish a poor record of compliance. We believe this final basis is not supported. It is the staff's assessment that there is not a basis to not accept the application.'

Citizens testify

Calling herself a 'long time resident' who lives mere blocks from the proposed location, Renée Kimball was first to testify. She was in favor of approving the application, she said, 'because a well-run establishment might get the [neighboring] Acropolis to 'come to the table', and do something about the odious, obnoxious, and sick behavior of some of their patrons.'

Turning to the club's owners, Kimball concluded by saying 'If you don't police your own establishment well, you'll unleash my wrath - something you don't want to do.'

Robert McCullough spoke next as the current President of the Eastmoreland Neighborhood Association, 'a neighborhood that's very middle class'. He affirmed that ENA's Board of Directors had joined with SMILE in opposing this license 'with a 100% vote of our board'. He commented that this would be the third 'adult' establishment along this section of S.E. McLoughlin Boulevard, including 'Blush', at S.E. 18th Avenue at McLoughlin Boulevard.

Ms. Gutierrez followed, saying, 'I represent the 94 families living in the low-rent apartments [nearby]. We have a lot of problems with the existing club. Opening a new club will bring more problems for our families and communities [in terms of] crime, theft, and other problems. All of our families deserve to live in a safe and quiet environment.'

In addition to expressing a concern regarding 'inadequate notice of the hearing given to the neighborhood', Lisa Brown said, 'Johnson Creek is not a barrier to the park during the warmer times of the year. We have a history of people coming over from the other side during the summer months.'

Mat Millenbach, President of the Sellwood Moreland Improvement League neighborhood association, read a letter expressing the SMILE Board's concerns about granting a license to the operators of the eastside Casa Diablo.

Speaking of the applicant's current location, Millenbach stated, 'The existing establishment has a reputation of attracting crime and of being a general nuisance in its current neighborhood in northwest Portland.' He said he was providing OLCC Commissioners at report of 'police responses to reported crimes ranging from assaults to disorderly conduct to vandalism to hit-and-run traffic accidents.'

Recent Portland Police Data System listings at the northwest Portland location, Millenbach added, 'Found that these kinds of problems are still occurring at the site. There have also been many neighbor complaints of nuisances such as vomiting and urination in the parking lot; litter, garbage, broken glass, needles, condoms, and diapers in the parking lot; and a general level of mayhem which nobody would welcome into their neighborhood.'

Equating the proposed opening of Casa Diablo with the neighboring Acropolis, Millenbach continued, 'To bring these two establishments together into the same location will only serve to increase the misery which local residents have to deal with.'

Consequently, Millenbach told the OLCC commissioners, SMILE recommends nine restrictions be included in the license, 'in order to do the best we can to deal with adverse impacts this establishment will bring to our neighborhood.'

'We strive for kids to play in nature,' Sellwood resident Bradley Heintz began his testimony, 'in places like Johnson Creek Park, a 'nature play area'.'

Producing a sheaf of paper, Heintz disputed the reported low crime statistics around the existing Casa Diablo location. 'There aren't only two - I found a total of 37 reports of crime. 22 of these included aggravated assault, suspicious activity, larceny, disorderly conduct, vandalism, fraud, assault, aggravated assault, etc.'

Other neighbors stepped up, including a resident of southwest Portland, and echoed the sentiments of those who testified before them.

Owners respond

Speaking for his partner, prospective club owner Johnny Diablo Zukle said they both took offense at witnesses 'throwing around multiple crimes we supposedly have at our place - which we don't.'

Zukle alleged that two neighbors near their industrially-zoned northwest Portland location call the police maliciously. 'The [police call] reports show only that the police came. They don't show that police didn't find a problem or crime. Many complaints were closed out with a 'W1 - No Report'. There's no report, because there was no crime - nothing happened.'

Zukle continued, 'In four years, we've had four assaults, which is about one a year. I'm sure other bars have a lot more assaults than we have. We do a very good job of keeping a professional environment.'

He was asked by a commissioner about a noise complaint for which they were fined.

'The report shows that, six days in a row, we were in [noise ordinance] violation,' explained Zukle. 'However, no one from the City came out to measure sound or document the violation. Anyone can go anonymously on Portland online.com and file a noise complaint.'

Asked if he sold a major interest in the club to his partner, Carol Lee, because of the noise violation, Zukle replied, 'The violation of the City's 'Time Place and Manner Ordinance' amounted to a $300 fine. There's no correlation between the fine and selling an interest in the club.'

Zukle said no one had approached him with a 'Good Neighbor Agreement' for the new location, and that they had - and abided by - such an agreement in their current location. 'I'm willing to work with anybody; they don't seem to want to work with us,' Zukle commented.

However, when OLCC Commissioner Ron Roome asked if the pair would be willing to make 'Good Neighborhood Agreement' requests a written condition of obtaining a license, Zukle said, 'We prefer not to, because sometimes conditions change.'

OLCC Commissioner Bob Rice asked if the owners wanted to continue, and try to work out a license agreement on the spot, or set over until June 28 hearings while they 'work out some of the differences' with neighbors.

After the hearing, co-owner Carol Lee apologized for not speaking much, saying that she had the flu. Zukle told THE BEE, 'We're here to open a good business. It is important that the community feels okay about us being there. Hopefully we'll get together over the next few weeks.'

About the 60 day delay, Zukle said, 'It costs us money. We have been waiting for a year to open the club. We'll create a lot of jobs - we're the only club like this in Portland that provides health and dental insurance for employees.'

Millenbach said SMILE would wait 'for the OLCC staff to get a hold of us and find out what role the City plays in this. We've done Good Neighbor Agreements before, with assistance from City staff.'

Asked about the chances that the club and the surrounding neighborhoods could come to a negotiated settlement - Millenbach replied, 'I don't know.'

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